Can Lack-of-Fit Penalties Apply to Male Entrepreneurs? Equity Fundraising in Femtech

Abstract

Persistent evidence of a male advantage in equity fundraising has led entrepreneurship scholars to assume that while women face fit penalties in male-typed industries, men are exempt from penalties in female-typed ones. Yet underlying sociological theory implies that lack-of-fit penalties would apply to both sexes. Analyzing 718 equity deals from 408 ventures in Femtech, we find that male CEOs raise smaller deal amounts than female CEOs. Post hoc analyses and interviews provide interpretive triangulation consistent with two plausible explanatory accounts, embodied task competence and moral legitimacy. This challenges the assumption that men are exempt from fit penalties in female-typed industries.